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EXHIBIT 2.5
SECOND AMENDMENT TO ACQUISITION AGREEMENT
THIS SECOND AMENDMENT TO ACQUISITION AGREEMENT (this "AMENDMENT")
is made and entered into effective as of March 2, 1998 between CHASWIL
UNITED CORP., an Ohio corporation with principal offices c/o United Liberty
Life Insurance Company, Suite 400, 120 West Fifth Street, Cincinnati, Ohio
45202 ("CHASWIL") and CITIZENS FINANCIAL CORPORATION, a Kentucky
corporation with principal offices at Suite 300, 12910 Shelbyville Road,
Louisville, Kentucky 40243 ("CITIZENS").
The parties hereto are the parties to an Acquisition Agreement,
dated as of December 12, 1997, as amended by a First Amendment to
Acquisition Agreement dated as of February 10, 1998 (as so amended, the
"ACQUISITION AGREEMENT," defined terms in which shall have the same
meanings when used herein unless otherwise defined herein). The parties
have agreed to amend the Acquisition Agreement to extent set forth herein
and no further.
NOW, THEREFORE, in consideration of the foregoing premises, the
representations, warranties and agreements herein contained in the
Acquisition Agreement and herein and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties
hereto agree as follows:
1. AMENDMENTS TO ARTICLE 2. Article 2 is amended and restated to
read in its entirety as follows:
ARTICLE 2
SALE OF SHARES AND CLOSING
2.1 PURCHASE AND SALE. Chaswil agrees to sell to Citizens
and/or to Citizens' Designated Subsidiary, and Citizens agrees to
purchase, either directly or with or through its Designated Subsidiary,
from Chaswil the Shares at the Closing pursuant to the terms and
subject to the conditions set forth in this Agreement, including
without limitation the provisions of SECTION 11.1 relating to
termination of this Agreement under certain conditions.
2.2 PURCHASE PRICE. The consideration for the Shares (the
"PURCHASE PRICE") shall be equal to:
(a) Six Million Four Hundred Thousand Dollars ($6,400,000)
(the "BASELINE AMOUNT");
(b) plus or minus, as applicable, the aggregate of the
adjustments to the Baseline Amount set forth in SECTION 2.3(B); and
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(c) plus or minus, as applicable, the aggregate of the
further adjustments to the Baseline Amount set forth in SECTION 2.3(C).
2.3 ADJUSTMENTS TO BASELINE AMOUNT.
(a) Not later than three (3) days prior to the Closing
Date, Chaswil will cause United to deliver to Citizens and Chaswil [i]
a statement (the "PRE-CLOSING STATEMENT") of the Pre-Closing Balance
Sheet Adjustment and [ii] the related Workpapers. Not later than
ninety (90) days after the Closing occurs, Citizens shall cause United
to prepare and deliver to Citizens and Chaswil [i] a statement (the
"CLOSING STATEMENT") of the Closing Balance Sheet Adjustment and [ii]
the related Workpapers. Citizens shall have the right to review the
Pre-Closing Statement and the related Workpapers, Chaswil shall have
the right to review the Closing Statement and the related Workpapers,
and Chaswil and Citizens shall be allowed access to the books
and records of United for their respective reviews. Subject to the
procedures described in SECTION 2.3(D) with respect to the resolution
of disputes concerning the Pre-Closing Statement and the Closing
Statement, the Pre-Closing Statement and the Closing Statement shall
constitute the basis for adjustments, if any, to Chaswil's Baseline
Amount as provided in SECTIONS 2.3(B) and (C).
(b) Chaswil's Baseline Amount shall be adjusted at the
Closing by adding to or subtracting from, as applicable, the Baseline
Amount the Pre-Closing Balance Sheet Adjustment as set forth in the
Pre-Closing Statement.
(c) Not later than seven (7) days after receiving the
Closing Statement, Citizens shall communicate in writing to Chaswil
the amount of the Closing Balance Sheet Adjustment as set forth in the
Closing Statement. If such amount is negative, it shall be referred
to herein as Chaswil's "POST-CLOSING PAYABLE." If such amount is
positive, it shall be referred to herein as Chaswil's "POST-CLOSING
RECEIVABLE." Subject to the provisions of SECTION 2.3(D), Chaswil
shall direct the Escrow Bank to pay in cash the full amount of
Chaswil's Post-Closing Payable, if any, to Citizens not later than
five (5) days after Chaswil's receipt of notice thereof from Citizens
or Citizens shall pay in cash the full amount of Chaswil's
Post-Closing Receivable, if any, not later than ten (10) days after
receiving the Closing Statement.
(d) After receiving the Pre-Closing Statement, Citizens
shall have the right to provide to Chaswil a written statement
(including the related Workpapers) of any discrepancy in or proposed
adjustment to the Pre-Closing Balance Sheet Adjustment set forth in
the Pre-Closing Statement. The parties shall promptly cooperate in
good faith for the purpose of
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resolving any such discrepancies or proposed adjustments, which
resolution, if achieved, shall be binding upon the parties and not
subject to dispute or review. If the parties cannot resolve such
discrepancies or proposed adjustments to their mutual satisfaction
prior to the Closing, then, subject to the provisions of SECTION
11.1(G), the Pre-Closing Balance Sheet Adjustment as set forth in the
Pre-Closing Statement shall be utilized solely for the purpose of
determining the amount to be paid by Citizens pursuant to SECTION
2.4(A) but shall not be deemed to have been agreed between the parties
for purposes of the Closing Balance Sheet Adjustment nor to limit
the conclusions of the Arbitrator (as hereinafter defined).
Not later than ten (10) days after receiving the Closing
Statement, Chaswil shall have the right to provide to Citizens a
written statement (including the related Workpapers) of any
discrepancy in or proposed adjustment to the Closing Balance Sheet
Adjustment set forth in the Closing Statement. The parties shall
promptly cooperate in good faith for the purpose of resolving any such
discrepancies or proposed adjustments, which resolution, if achieved,
shall be binding upon the parties and not subject to dispute or review.
If the parties cannot resolve such discrepancies or proposed
adjustments to their mutual satisfaction within an additional thirty
(30) days after delivery of such written statement or statements,
then as their exclusive method of resolving such discrepancy or
proposed adjustments, Chaswil and Citizens shall jointly designate
(upon such terms of compensation, exculpation and indemnification as
shall be acceptable to them) such accounting firm of national
reputation as may be agreed to by the parties (the "ARBITRATOR") to
resolve such discrepancy or proposed adjustment, and shall promptly
submit the matter to the Arbitrator. The Arbitrator, as expeditiously
as possible but in any event not later than thirty (30) days after
submission to it of such discrepancies or proposed adjustments, shall
report its conclusions in writing to Chaswil and Citizens, and
such conclusions shall be binding upon all parties to this Agreement
and not subject to dispute or review. The fees and expenses of the
Arbitrator shall be paid by the party (i.e. Chaswil, on the one hand,
or Citizens, on the other hand) whose last proposed offer for
settlement of the dispute with respect to all alleged discrepancies
or proposed adjustments, taken as a whole, with respect to the Closing
Statement is farther away from the Closing Balance Sheet Adjustment
as finally determined pursuant to this paragraph. If on the basis
of the Closing Statement it is finally determined pursuant to this
paragraph that an amount is due to Citizens from Chaswil, then
Chaswil shall direct the Escrow Bank to pay to Citizens promptly in
cash such amount. If on the basis of the Closing Statement, it is
finally determined pursuant to this paragraph that an amount is due
to Chaswil from Citizens, then Citizens shall pay to Chaswil promptly
in cash such amount.
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2.4 PAYMENT OF THE PURCHASE PRICE. Citizens and/or Designated
Subsidiary shall pay the Purchase Price as follows.
(a) The Baseline Amount plus or minus, as applicable, the
aggregate of adjustments to the Baseline Amount set forth in SECTION
2.3(B) and minus the amounts payable as provided in paragraphs (b) and
(c) next following shall be paid by wire transfer on the Closing Date
of immediately available funds to Chaswil.
(b) $250,000 (the "ESCROW DEPOSIT") shall be paid on the
Closing Date by Citizens or its Designated Subsidiary to a bank under
the terms of an escrow agreement approved by Chaswil and Citizens,
whose approvals shall not be unreasonably withheld or delayed (the
"ESCROW BANK" and the "ESCROW AGREEMENT," respectively) that provides
[i] for payment to Chaswil of the Escrow Deposit less any Chaswil
Post-Closing Payable and [ii] for payment to Citizens and/or
Designated Subsidiary of any Chaswil Post-Closing Payable on before
seven (7) days after the determination of the aggregate of the further
adjustments to the Baseline Amount set forth in SECTION 2.3(C)
following completion of any procedures initiated pursuant to SECTION
2.3(D).
(c) At the Closing, subject to all of the terms and
conditions of this Agreement, Citizens and/or its Designated Subsidiary
shall purchase from United [i] the three mortgage loans listed in
EXHIBIT C (the "MORTGAGE LOANS") for a price equal to the then
aggregate principal balances thereof and accrued interest thereon and
[ii] United's interest in Caribe Beach Resort, Sanibel, Florida (the
"CARIBE INTEREST") for a price equal to the then aggregate balance of
United's investment therein. At the Closing, Citizens shall assign
and transfer to Chaswil, without recourse, the documents evidencing
and securing the Mortgage Loans and the Caribe Interest in part
payment of the Purchase Price.
2.5 CLOSING. Subject to the provisions of this Agreement,, the
Closing of the transactions contemplated by this Agreement, including,
without limitation, the consummation of the sale and purchase of
the Shares, as provided in SECTION 2.1 hereof and the execution and
delivery of the documents and instruments specified in this SECTION 2.5,
will take place at the offices of Citizens' counsel in Louisville,
Kentucky at 10:00 a.m., local time, on the Closing Date. At the
Closing, Chaswil will assign and transfer to Citizens and/or its
Designated Subsidiary, good and valid title, and all other rights and
interests of Chaswil, in and to the Shares, free and clear of all liens.
To effect such assignment and transfer, Chaswil will deliver
certificates representing all of the Shares, in genuine and unaltered
form, accompanied by duly executed blank stock powers or (at the
request of
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Citizens) endorsed in blank for transfer. Chaswil will execute and
deliver to Citizens and/or its Designated Subsidiary such documents and
instruments as are required of Chaswil under the terms and provisions
of this Agreement. All such certificates, stock powers, documents
and instruments will be in form and substance reasonably satisfactory
to Citizens. Citizens will pay the Purchase Price as provided in
SECTION 2.4 and deliver such documents and instruments as are required
of Citizens under the terms and conditions of this Agreement. All such
documents and instruments will be in form and substance reasonably
satisfactory to Chaswil.
2. AMENDMENTS TO ARTICLE 3. The following-indicated Sections and
Subsections of Article 3 are amended and restated to read in their entirety
as follows:
3.8 SAP STATEMENTS. Chaswil has previously delivered to the
Citizens true and complete copies of the following SAP Statements:
(a) Annual Statements for United for each of the years ended
December 31, 1995, 1996 and 1997(and the notes relating thereto); and
(b) Quarterly Statements for United for each of the first
three quarters of each of 1995 and 1996 and the first three quarters
of 1997 (and the notes relating thereto).
Except as disclosed in SECTION 3.8 OF THE DISCLOSURE SCHEDULE, each such
SAP Statement complied in all material respects with all applicable Laws
when so filed, and all material deficiencies with respect to any such SAP
Statement have been cured or corrected. Each such SAP Statement (and the
notes relating thereto), including without limitation each balance sheet
and each of the statements of operations, capital and surplus account, and
cash flow contained in the respective SAP Statement, was prepared in
accordance with SAP, is true and complete in all material respects, and
presents fairly, in all material respects, the admitted assets,
Liabilities, and capital and surplus of United as of the respective dates
thereof and its respective results of operations and cash flows for and
during the respective periods covered thereby, all in accordance with SAP.
3.9 RESERVES.
(a) Except as disclosed in SECTION 3.9(A) OF THE DISCLOSURE
SCHEDULE, all reserves and other Liabilities with respect to insurance
and for claims and benefits incurred but not reported (collectively,
the "RESERVE LIABILITIES"), as established or reflected in the
respective SAP Statements of United (including without limitation
the reserves and policy and Contract
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Liabilities to be reflected respectively on LINES 1 THROUGH 11, 15,
24.2, 24.3 AND 24.6 OF PAGE 3 OF THE DECEMBER 31, 1997 ANNUAL
STATEMENT), were determined in accordance with generally accepted
actuarial standards consistently applied, are fairly stated in
accordance with sound actuarial principles, are based on actuarial
assumptions that are in accordance with those called for by the
provisions of the related insurance Contracts and in the related
reinsurance, coinsurance and other similar Contracts of United, and
meet in all material respects the requirements of the insurance Laws
of its state of domicile. Adequate provision for all such Reserve
Liabilities have been made (under generally accepted actuarial
principles consistently applied)to cover the total amount of all
reasonably anticipated matured and unmatured benefits, dividends,
claims and other Liabilities of United under all insurance Contracts
under which United has any Liability (including without limitation
any Liability arising under or as a result of any reinsurance,
coinsurance or other similar Contract) in United's DECEMBER 31,
1997 ANNUAL STATEMENT based on then current information regarding
interest earnings, mortality and morbidity experience, persistency
and expenses. No warranty is made as to the ultimate adequacy of the
Reserve Liabilities to satisfy the liabilities and obligations
reserved against. United owns assets that qualify as legal reserve
assets under applicable insurance Laws in an amount at least equal to
all such Reserve Liabilities; and
(b) Except as described in SECTION 3.9(B) OF THE DISCLOSURE
SCHEDULE, all reserves and accrued Liabilities for contingencies such
as, but not limited to, estimated losses, settlements, costs and
expenses from pending suits, actions and proceedings included in the
DECEMBER 31, 1997 ANNUAL STATEMENT were determined in accordance with
SAP.
3.11 NO UNDISCLOSED LIABILITIES. Except to the extent reflected
in the balance sheet included in the DECEMBER 31, 1997 ANNUAL STATEMENT
(and the notes relating thereto), or except as disclosed in SECTION
3.10 OR 3.11 OF THE DISCLOSURE SCHEDULE, there were no Liabilities
(other than policyholder benefits payable in the ordinary course
of business and consistent with past practice for which appropriate
reserves have been provided) against, relating to, or affecting United
as of DECEMBER 31, 1997 exceeding $30,000 in the aggregate. Except to
the extent specifically reflected in the balance sheets included in the
DECEMBER 31, 1997 ANNUAL STATEMENT (and the notes relating thereto)
or except as disclosed in SECTION 3.11 OF THE DISCLOSURE SCHEDULE,
since DECEMBER 31, 1997, United has not incurred any Liabilities
exceeding $30,000 in the aggregate (other than policyholder benefits
and other obligations payable in the ordinary course of business and
consistent with past practice for which appropriate reserves have been
provided).
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3.12(m) As of DECEMBER 31, 1997, United did not have and
during the period from DECEMBER 31, 1997 through the Closing Date will
not have any tax liability to Chaswil or any Affiliate of Chaswil that
resulted or will result from a transaction with an Affiliate prior to
the Closing Date that would require payment after DECEMBER 31, 1997.
3.17(k) all material Contracts for any product, service,
equipment, facility, or similar item (other than insurance and annuity
Contracts and other than reinsurance, coinsurance, and other similar
Contracts) that by their respective terms do not expire or terminate or
are not terminable by United, without penalty or other Liability,
within ninety (90) days after the CLOSING; and
3. AMENDMENTS TO ARTICLE 5.
A. The following-indicated Section of Article 5 is amended and
restated to read in its entirety as follows:
5.18 INTERCOMPANY LIABILITIES. At least five (5) Business
Days before the Closing, Chaswil will deliver to Citizens a true and
complete list and description of all Liabilities between United and
Chaswil or any other Affiliate of United to be outstanding on the
Closing Date. At or prior to the Closing, all such liabilities shall
be released, except as otherwise specifically provided herein. Chaswil
will cause United to refrain from entering into any Contract or engage
in any transaction with Chaswil or any other Affiliate of United.
Except as otherwise specifically provided herein or as otherwise agreed
to by Citizens and Chaswil prior to the Closing Date, on or before the
Closing Date, Chaswil will terminate and will cause its Affiliates to
terminate each Contract between United and Chaswil or any other
Affiliate of United; except that Chaswil shall make available to
Citizens or Designated Subsidiary on a month-to-month and cost-
reimbursement basis the use of Chaswil's AS 400 computer and current
software used in the administration of United's business.
B. Section 5.28 of Article 5 is deleted and shall be of no
further force or effect.
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4. AMENDMENT TO ARTICLE 7. The following-indicated Section of
Article 7 is amended and restated to read in its entirety as follows:
7.3(g) copies of general releases on the part of Chaswil and
United, respectively, of any and all claims, liabilities, and
obligations each has and may have against the other, executed by their
respective presidents; and
5. AMENDMENTS TO ARTICLE 11. The following-indicated Section of
Article 11 is amended and restated to read in its entirety as follows:
11.1 TERMINATION. This Agreement may be terminated, and the
transactions contemplated hereby may be abandoned, upon notice by
the terminating party to the other party:
(a) at any time before the Closing, by mutual written
agreement of Chaswil and Citizens; or
(b) at any time by Chaswil if any of the covenants set
forth in ARTICLE 6 shall have been breached or any of the conditions
set forth in ARTICLE 8 hereof shall not have been satisfied,
performed, or complied with, in any material respect, at or before
the Closing Date and such breach, non-satisfaction, nonperformance, or
non-compliance has not been cured or eliminated within 10 calendar
days after notice thereof has been given to Citizens, provided that
at the time of such termination Chaswil has neither breached any of
the covenants set forth in ARTICLE 5 nor failed to satisfy, perform,
or comply with any of the conditions set forth in ARTICLE 7 hereof,
in any material respect;
(c) at any time by Citizens if any of the covenants set
forth in ARTICLE 5 shall have been breached or any of the conditions
set forth in ARTICLE 7 hereof shall not have been satisfied,
performed, or complied with, in any material respect, before the
Closing Date and such breach, non-satisfaction, non-performance, or
non-compliance has not been cured or eliminated within 10 calendar
days after notice thereof has been given to Chaswil, provided that at
the time of such termination Citizens has neither breached any of the
covenants set forth in ARTICLE 6 nor failed to satisfy, perform, or
comply with any of the conditions set forth in ARTICLE 8 hereof, in
any material respect;
(d) [intentionally omitted];
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(e) at any time after April 30, 1998, by Chaswil or
Citizens, if the transactions contemplated by this Agreement have not
been consummated on or before such date and such failure to consummate
is not caused by a breach of this Agreement (or any representation,
warranty, covenant, or agreement included herein) by the party
electing to terminate pursuant to this clause (e); provided, however,
that either party may by notice to the other extend such date to May
31, 1998, if the only conditions to Closing not satisfied as of April
30, 1998 are those set forth in SECTION 7.4, 7.7, 8.4 OR 8.7 hereof;
(f) [intentionally omitted]; or
(g) by Citizens, at any time prior to the Closing, if [i]
in the opinion of Citizens, the Pre-Closing Statement as proposed
by Chaswil overstates the Adjusted Capital and Surplus of United
by more than $250,000, [ii] Chaswil refuses to revise the Pre-Closing
Statement to eliminate the claimed overstatement, and [iii] Chaswil
and Citizens are unable to agree upon a Pre-Closing Balance Sheet
Adjustment.
6. AMENDMENTS TO EXHIBIT A.
The following-indicated terms defined in Exhibit A are amended and
fully restated to read in their entirety as follows:
"Adjusted Capital and Surplus of United" shall mean [i] United's
statutory capital and surplus as of the close of business on last
day of any measurement period computed in a manner consistent with the
computation of such amount for inclusion in PAGE 3, LINE 38, OF ITS
DECEMBER 31, 1997 ANNUAL STATEMENT, plus [ii] its AVR and statement
value IMR as of the close of business on the last day of such
measurement period, computed in a manner consistent with the
computation of such amounts for inclusion on PAGE 3, LINES 11.4 AND
24.1 OF ITS DECEMBER 31, 1997 ANNUAL STATEMENT.
"Agreement" shall mean this Acquisition Agreement and all
amendments hereto, together with the exhibits attached hereto, the
Disclosure Schedule, and other documents to be executed and delivered
respectively by Chaswil and/or Citizens pursuant hereto.
"Closing Adjustments" shall mean the amounts to be added to or
deducted from, as the case may be, any increase in Adjusted Capital
and Surplus at the Second Reference Date or any decrease in Adjusted
Capital and Surplus at the Second Reference Date equal to the amounts,
if any, by which the Permitted Carrying Values of assets reflected
in UNITED'S DECEMBER
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31, 1997 ANNUAL STATEMENT or subsequently acquired exceed or are
less than, as the case may be, their stated values in such DECEMBER
31, 1997 ANNUAL STATEMENT or in the case of subsequently acquired
assets their cost. Closing Adjustments shall give effect to the
transactions described in SECTION 2.4(D) as though they had occurred
and include, as applicable, deductions for all severance, compensated
absence and other post-employment benefits as described in SFAS 43
and 112 that would be payable to United's employees assuming their
termination in conjunction with the closing of the transactions
contemplated hereby.
"Closing Balance Sheet Adjustment" shall mean (x) any increase or
any decrease in the Adjusted Capital and Surplus of United from (and
including) January 1, 1998 to the day immediately preceding the date
of the Closing (the "SECOND REFERENCE DATE"), plus or minus, as
applicable, (y) any Closing Adjustments, subject to the review
procedures contemplated by SECTION 2.3(D) hereof. Citizens represents
and warrants that the balance sheet of United as of the Second
Reference Date shall be prepared, and all determinations required for
measuring changes in the Adjusted Capital and Surplus of United as
contemplated hereby and for the purposes hereof have been and shall
be, in accordance with SAP consistently applied.
"Closing Date" shall mean [i] the last Business Day of the month
that includes the date upon which the last of the orders or approvals
described in SECTIONS 5.1, 5.2, 6.1, AND 6.2 hereof has been
obtained, including without limitation the approvals under all
applicable insurance holding company Laws, or [ii] such other date
as Citizens and Chaswil may mutually agree upon in writing.
"Pre-Closing Adjustments" shall mean the amounts to be added to
or deducted from, as the case may be, any increase in Adjusted
Capital and Surplus at the First Reference Date or any decrease in
Adjusted Capital and Surplus at the First Reference Date equal to the
amounts, if any, by which the Permitted Carrying Values of assets
reflected in UNITED'S DECEMBER 31, 1997 ANNUAL STATEMENT or
subsequently acquired exceed or are less than, as the case may be,
their stated values in such DECEMBER 31, 1997 ANNUAL STATEMENT or
in the case of subsequently acquired assets their cost. Pre-Closing
Adjustments shall give effect to the transactions described in SECTION
2.4(D) as though they had occurred and include, as applicable,
deductions for all severance, compensated absence and other post-
employment benefits as described in SFAS 43 and 112 that would be
payable to United's employees assuming their termination in
conjunction with the closing of the transactions contemplated hereby.
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"Pre-Closing Balance Sheet Adjustment" shall mean (x) any increase
or any decrease in the Adjusted Capital and Surplus of United from
(and including) January 1, 1998 to (and including) the last day of the
month immediately preceding the date of the Closing or, if it is not
practicable to determine the Adjusted Capital and Surplus as of such
day, then to (and including) the last day of the next preceding month
(in either case, the "FIRST REFERENCE DATE"), plus or minus, as
applicable, (y) any Pre-Closing Adjustments, in each case subject to
the review procedures contemplated by SECTION 2.3(D) hereof. Chaswil
represents and warrants that UNITED'S DECEMBER 31, 1997 ANNUAL
STATEMENT have been prepared, and the balance sheet of United as of
the First Reference Date shall be prepared, and all determinations
required for measuring changes in the Adjusted Capital and Surplus of
United as contemplated hereby and for the purposes hereof have been,
and shall be, in accordance with SAP consistently applied and with
the procedures and practices used in the preparation of UNITED'S
DECEMBER 31, 1997 ANNUAL STATEMENT.
7. AUTHORITY OF CHASWIL. Chaswil represents and warrants to Citizens
that the Board of Directors and shareholders of Chaswil have duly and validly
approved this Amendment and the transactions contemplated hereby. The
execution and delivery of this Amendment by Chaswil and the performance by
Chaswil of its obligations under this Amendment have been duly and validly
authorized by all necessary corporate action on the part of Chaswil. This
Amendment constitutes a valid and binding obligation of Chaswil and is
enforceable against Chaswil in accordance with its terms, except to the extent
that [i] enforcement may be limited by or subject to any bankruptcy,
insolvency, reorganization, moratorium, or similar Laws now or hereafter in
effect relating to or limiting creditors' rights generally and [ii] the
remedy of specific performance and injunctive and other forms of equitable
relief are subject to certain equitable defenses and to the discretion of the
court or other similar Person before which any proceeding therefor may be
brought; provided, however, that to the Knowledge of Chaswil no party has
any equitable defenses that would affect the enforcement of this Amendment
against Chaswil.
8. AUTHORITY OF CITIZENS AND DESIGNATED SUBSIDIARY. The Board of
Directors of Citizens has duly and validly approved this Amendment and the
transactions contemplated hereby. The execution and delivery of this
Amendment by Citizens and the performance by Citizens of its obligations
under this Amendment have been duly and validly authorized by all necessary
action on the part of Citizens. This Amendment constitutes a valid and
binding obligation of Citizens and is enforceable against Citizens in
accordance with its terms, except to the extent that [i] enforcement may be
limited by or subject to any bankruptcy, insolvency, reorganization,
moratorium, or similar Laws now or hereafter in effect relating to or
limiting creditors' rights generally and [ii] the remedy of specific
performance and injunctive and other forms of equitable relief are subject
to certain
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equitable defenses and to the discretion of the court or other similar Person
before which any proceeding therefor may be brought; provided, however,
that to the Knowledge of Citizens no party has any equitable defenses that
would affect the enforcement of this Amendment against Citizens. On
the Closing Date, the transactions contemplated hereby on its part to be
performed by Designated Subsidiary will be duly and validly authorized by
all necessary corporate action on the part of such Designated Subsidiary.
9. OTHER PROVISIONS
A. Except for documents executed by Chaswil and Citizens pursuant
hereto, this Amendment supersedes all prior discussions and agreements
between the parties with respect to the subject matter of this Amendment,
and this Amendment (including the exhibits hereto, the Disclosure Schedule,
and other Contracts and documents delivered in connection herewith)
contains the sole and entire agreement between the parties hereto with
respect to the subject matter hereof.
B. This Amendment may be modified or amended only by a writing duly
executed by or on behalf of all parties hereto.
C. This Amendment may be executed simultaneously in any number of
counterparts, each of which will be deemed an original, but all of which
will constitute one and the same instrument.
D. The terms and provisions of this Amendment are intended solely for
the benefit of the parties hereto, and their respective successors or
assigns, and it is not the intention of the parties to confer third-party
beneficiary rights upon any other Person.
E. This Amendment shall be governed by and construed in accordance
with the Laws of the State of Kentucky applicable to a contract executed and
performable in such state; provided, however, that any legal proceedings
brought by Chaswil against Citizens or Designated Subsidiary or their
assignees pursuant to or n connection with this Amendment shall be brought
only in Jefferson County, Kentucky.
F. This Amendment is binding upon and will inure to the benefit
of the parties and their respective successors and assignees.
G. The headings used in this Amendment have been inserted for
convenience and do not constitute matter to be construed or interpreted in
connection with this Amendment. Unless the context of this Amendment
otherwise requires, [i] words of any gender are deemed to include each
other gender; [ii] words using the singular or plural number also include
the plural or singular number, respectively; [iii] the terms "hereof,"
"herein," "hereby," hereto," and derivative or similar words refer to this
entire Amendment; [iv] the terms "Article" or "Section" refer to the
specified Article or Section of this
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Amendment; and (e] all references to "dollars" or "$" refer to currency of the
United States of America.
H. If any provision of this Amendment is held to be illegal, invalid,
or unenforceable under any present or future Law, and if the rights or
obligations of Chaswil or Citizens under this Amendment will not be
materially and adversely affected thereby, [i] such provision will be fully
severable; [ii] this Amendment will be construed and enforced as if such
illegal, invalid, or unenforceable provision had never comprised a part
hereof; [iii] the remaining provisions of this Amendment will remain in
full force and effect and will not be affected by the illegal, invalid, or
unenforceable provision or by its severance herefrom; and [iv] in lieu of
such illegal, invalid, or unenforceable provision, there will be added
automatically as a part of this Amendment a legal, valid, and enforceable
provision as similar in terms to such illegal, invalid, or unenforceable
provision as may be possible.
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IN WITNESS WHEREOF, this Amendment has been duly executed and
delivered by the duly authorized officers of Chaswil and Citizens,
effective as of the date first written above.
CHASWIL UNITED CORP.
By_________________________________
_______________________
(vice) President
CITIZENS FINANCIAL CORPORATION
By_________________________________
_______________________
(vice) President
Exhibit:
C - Mortgage Loans
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